Global Q2 semi equipment industry book-to-bill below parity

By Colleen Taylor, Contributing Editor -- Electronic News, 8/15/2007

The worldwide semiconductor equipment industry's book-to-bill ratio stayed below parity at 0.92 in Q2, San Jose-based industry association Semiconductor Equipment and Materials International (SEMI) reported today, while maintaining that the industry is on track to bring in sales on par with 2006 for the full-year 2007.

SEMI reported that worldwide semiconductor equipment bookings reached $10.22 billion in Q2. The figure is 18 percent less than the same quarter a year ago and about 4 percent below the bookings figure for Q1.

Meanwhile, worldwide semiconductor manufacturing equipment billings reached $11.06 billion in Q2, 3 percent higher than Q1 and about 15 percent higher than the
same quarter a year ago.  (See below chart for quarterly billings data by region.)

SEMI Q1 data showed a book-to-bill ratio of 0.97.

"Investment by memory manufacturers was particularly strong during the first half of the year resulting in modest growth in billings during the second quarter," Stanley T. Myers, president and CEO of SEMI, said in a statement. "Bookings, while experiencing a slight decline, remain at sustainable levels, with this year's revenues expected to be on par with 2006."

Indeed, last month market research firm Gartner Dataquest reported that semiconductor capital spending is experiencing a shallow correction that started in Q2 and is set to extend into early 2008. Due to the current recession of new equipment orders based on exhaustion of DRAM capital spending budgets and as other segments fail to increase their budgets to compensate, the firm predicted semiconductor equipment growth of less than 1 percent for this year.

SEMI’s mid-year capital equipment consensus forecast also indicated just 1 percent growth for the semiconductor manufacturing equipment market to $40.9 billion, following 23 percent growth in 2006.

Billings data by region in millions of dollars, with year-over-year and quarter-over-quarter growth rates

Source: SEMI, August 2007